Publishers Weekly has a listing of “Top Publishers Worldwide by Revenue, 2014” in its 6 July issue. Superficially the list doesn’t look that surprising, but if you focus on the revenue generated by the 57 publishers ranked in the list, I at least learned something new. What is striking is the relative insignificance of the so-called Big Five: Penguin Random House, Hachette, Holtzbrinck, HarperCollins and Simon & Schuster. These five taken together had 2014 revenues of $10,697,000,000, not that much more than the single largest publisher, Pearson, at $7,801,000,000. Yet we are bombarded by pronouncements about the future of publishing extrapolated from the performance of these Big Five. We never hear conclusions drawn about the future of publishing based on what Pearson, Thomson Reuters, Relx Group (Reed Elsevier), and Wolters Kluwer, the top four earners in the list, have been doing. These four have combined revenues twice as large as the Big Five: $22,649,000,000. Penguin Random House comes in at #5 on the list, Hachette at #8, Holtzbrinck at #10, HarperCollins at #16, and S & S at #30.

Of course the reason for the Five-focus is that most people know that book publishing means trade publishing, and these are the five largest trade houses. They publish the sort of books the bibliorati know about, and these commentators conclude that that means these houses publish everything of any importance. However the real money is to be found in education and professional publishing, which is what the actual big guys do. Acquisitions are common in these areas, and all of the companies are heavily engaged in digital delivery of content. But the key, idiot-level, difference from trade is that books published in the education and professional markets are books which people need to buy, not books which people have to be persuaded to buy. That technical manual of nuclear plant maintenance will clearly sell at a much higher price that the latest financial thriller. Fewer copies of course, but each one at a much higher margin, and with a sharply lower inventory risk. Do a few of these and you’re off and running.

Making my own forecasts from this information, I continue to predict a reduction in importance of trade publishing. People will of course still want entertainment, and there will of course be publishers striving to give it to them, but the business is surely vulnerable to e-book-ification, which in its turn makes self publishing, or non-traditional publishing an ever more viable alternative. Given the immense concentration in education and professional publishing, I am really drawing a bow at a venture when I continue to suggest that the smaller publishing house will be the area of greatest activity in the book business. Maybe this is just my own version of bibliorati-blindness. I do think that education publishing is clearly an area where economies of scale do tend to mandate bigger and bigger companies. The threat to them comes perhaps from an upheaval in the university education business. In professional publishing big on-line publishing like Lexis-Nexis and Westlaw obviously needs scale; but I don’t think that we necessarily get better nursing manuals because a big publisher brings them out. There are going to be more and more opportunities for small, specialized publishers to insert themselves into this market.

The university presses are a good model for this sort of activity. (There are only two university presses on the PW list, Oxford at #19, and Cambridge at #38.) A university press has the freedom to publish books based on the value of their content rather than the potential value of their sales. As Sam Leith suggests in The Guardian the university presses are ideally situated to pick up the slack of serious non-fiction publishing which is more and more being sloughed off by trade houses as insufficiently “big” in sales potential. Leith quotes Tim Mundy as saying “Most are non-profits – they don’t require the 15p in the pound margins that the likes of Penguin Random House do. They often operate globally. Academic presses love librarians, and university libraries still buy books. And they are able to be much bolder with higher cover prices. So they are able to take those risks. Big conglomerates are very effective brand management systems – they can make comedians into novelists. And they can sell the big names – the Pinkers and the Schamas and so on. But the nursery slopes – the future stars – are now more and more on the lists of the university presses.” This is all fine except for the implication (commonly held) that non-profit means just that. University presses have to make a profit, or they’d go out of business — even those smaller ones which receive a subsidy from their university have to limit their losses by making a profit on some of their books. They are “not-for-profit” rather than “non-profit” — profits are not the main point, but they cannot be ignored.